Groundbreaking on Cuyahoga Falls retail development planned for August

Wednesday

Apr 24, 2013 at 4:00 AM

By Phil Keren | cuyahoga falls news-press editor

The developer of Portage Crossing in Cuyahoga Falls said he and his colleagues are "ready to go" with their project and are looking to break ground this summer.

Stark Enterprises is planning to build Portage Crossing, a 241,000-square-foot shopping center, at Portage Trail and State Road on the site of the former State Road Shopping Center in Cuyahoga Falls.

Steve Rubin, chief operating officer for Stark Enterprises, said his firm is hoping to break ground on Portage Crossing in August.

"We are ready to go," said Rubin when he addressed City Council Monday.

Rubin said Stark Enterprises has signed agreements with anchor tenants Giant Eagle and Cinemark. He added that Stark has signed lease deals with Fashion Nails and Best Cuts, and has a signed letter of intent with Huntington Bank. A map that Stark officials displayed at Monday's Council meeting indicated that Pet Supplies Plus had a signed lease deal as well.

The proposed sale of the former shopping center property to Stark Enterprises is in Council's finance committee for its review. Some revisions have been made to the proposed sales contract and the committee will discuss those changes at its next meeting May 6.

However, at Monday's meeting, Susan Truby, the city's community development director, reviewed the changes to the proposed agreement for the $42 million project.

The three major changes are:

n The city will provide Stark Enterprises an electric reimbursement of no more than $50,000 annually for 10 years for electric usage in areas such as parking lots and sidewalks;

n Using admissions taxes generated by the Cinemark movie theater, Stark Enterprises will receive no more than $129,600 annually for 10 years. If the admissions tax is higher than $129,600, the city will keep the surplus. In the 11th year, 100 percent of the admissions tax money will go to the city coffers.

n The date for closing on the property is now June 30.

"These incentives were re-negotiated with the developer as a result of the relocation of Menards and additional expenses related to cut and fill, EPA-mandated environmental vapor barriers and movie theater build-out," wrote Truby in an April 20 letter to Council.

Menards was originally supposed to be the second anchor tenant in the development, but the plan fell through when the city and the land owner of a Pizza Hut were unable to work out a deal to relocate the Pizza Hut building to make room for Menards.

Truby said it is estimated that Portage Crossing will provide more than 500 new full-time jobs, more than 185 temporary construction jobs with an estimated payroll of $4.6 million, new annual city revenue of $762,746 and new annual school district revenue of $265,144.

Councilmember Carol Klinger (R-At Large) told Truby she felt there were areas of the proposed contract that needed to have more specific language and she also challenged the projected job numbers. The job creation formula used by the city, according to Klinger, was 2.5 jobs per 1,000 square feet. Cinemark is planned to be 34,562 square feet. Using the city's formula, Cinemark would have 85 jobs, a number that Klinger questioned because a nearby movie theater that closed at the beginning of the year had 15 full-time and part-time employees.

Truby said Stark's finance representative had done calculations on movie theaters and had come up with a figure of "about 89 jobs" on the Cinemark movie theater.

"I didn't discount his number, but I used the lower number on that, to be conservative," said Truby. "Everything we have done here is based on an estimate of what we know today, and on that estimate, we've been conservative on every approach."

Klinger said she felt the contract "heavily favors the developer because there are no guarantees in this contract that any of these numbers will be met, none, not for us, not for the city, and that's where I see the lopsidedness in this contract, and that's where I believe this contract needs to be modified."

She later added, "A few small changes in this contract would protect us."

"We need to move forward with this project without any further delay," said Councilmember Ken Barnhart (R-3).

"This is going to be an exciting project," said Mayor Don Robart, who encouraged City Council to pass the amended sales contract at its regular meeting on May 13.

Truby has said the administration would like the sales contract to be approved before Stark Enterprises representatives attends the International Council of Shopping Centers event in Las Vegas in mid-May. At that event, Stark officials will have a chance to approach other retailers about leasing space in the development, and having a signed sales contract with the city would improve their ability to secure those leases, said Truby.

Council's finance committee will continue to discuss the proposed sales agreement at its next meeting on May 6 at 6:30 p.m. in the Natatorium, 2345 Fourth St., Cuyahoga Falls.

Meanwhile, the Cuyahoga Falls Planning Commission will review the major site plan for the project at its meeting on May 7 at 5:30 p.m. in the Natatorium.